Bailed-out Portugal's political crisis abates, but troubles are expected to return

LISBON, Portugal – Portugal's immediate political crisis is contained but after rejecting demands for a snap election, Portuguese President Anibal Cavaco Silva may have inadvertently pushed the country further into political uncertainty and another bailout.

In his address to the country Wednesday, Cavaco Silva said he had decided to keep the country's troubled coalition government in office. That ensures, for the moment, continuing compliance with the terms of a 78 billion euros ($101 billion) rescue.

But by asking the country's feuding political parties to surrender their political agendas and work on a shared economic recovery strategy, the president kept alive doubts about the country's political future and stoked fears Portugal, like Greece, may need a second bailout.

Citigroup economists said in a note Thursday "the political crisis in Portugal is far from over."